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New tax chief faces low revenue collection
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Newly installed taxation director general Suryo Utomo. (JP/Anton Hermansyah)
T
he newly installed tax chief is facing the growing challenge of low tax revenue collection as the country’s economy continues to grow at a snail’s pace, hitting businesses hard.
President Joko “Jokowi” Widodo has picked Suryo Utomo, formerly expert staffer on tax compliance to Finance Minister Sri Mulyani Indrawati, as the new taxation director general. Sri Mulyani swore him in on Friday to replace outgoing Robert Pakpahan, who is set to retire.
Suryo, 50, had served as the finance minister's expert tax compliance staffer since 2015. He was the director of taxation regulation at the tax office between 2011 and 2012 and director of expansion and assessment in 2015.
Center for Indonesia Taxation Analysis executive director Yustinus Prastowo welcomed Suryo’s appointment as tax chief, adding that the move highlighted Jokowi’s and Sri Mulyani’s trust in him as an integral figure in the tax office.
However, he urged Suryo to look for more ways to improve revenue collection, particularly by zeroing in on new revenue sources.
“The challenges from tax revenue are also a concern because the need to finance development continues to rise,” Yustinus wrote in a statement. “Amid calls for moderation [in revenue collection], there are new revenue sources that could be followed up and could generate extra revenue, particularly from taxation information.”
Indonesia’s economic growth slowed to a two-year low of 5.05 percent in the second quarter amid cooling domestic spending and weakening investment. The government has been attempting to attract more investment by, among other methods, offering tax incentives to businesspeople, which will result in lower tax revenues.
